Back in the driver’s seat: Ford India’s timeline and Chennai plant revival

Ford Motor | Photograph: Reuters

The corporate’s management, together with key executives from its international operations, not too long ago met with Tamil Nadu Chief Minister M Ok Stalin throughout a go to to the USA. The discussions centred round reviving operations on the Chennai facility, which has an annual capability of 200,000 autos and 340,000 engines.

Additional particulars, together with the precise kind of autos to be manufactured and the markets they are going to serve, are anticipated to be revealed sooner or later. The Tamil Nadu authorities has been supportive of this transfer, seeing it as a possibility to bolster the state’s automotive sector.

Ford’s determination to restart operations in India, albeit with a distinct focus, comes after a rocky few years within the Indian market. The corporate initially entered India in 1995 in a three way partnership with Mahindra & Mahindra, however regardless of introducing well-liked fashions just like the Ford Figo and EcoSport, Ford struggled to seize important market share. In September 2021, the corporate introduced its determination to exit the Indian market, citing sustained losses.

A whole timeline of Ford in India

1926: Ford Motor Firm started its first operations in India as a subsidiary of Ford Motor Firm of Canada.

1953: The unique Ford India firm was liquidated as a result of stringent import restrictions.

1995: Ford re-entered the Indian market by way of a three way partnership with Mahindra & Mahindra, forming Mahindra Ford India Ltd, with Ford holding a 50 per cent stake.

1996: The corporate launched its first car, the Ford Escort sedan, marking its return to Indian car manufacturing.

1998: Ford elevated its stake within the three way partnership to 72 per cent and renamed the corporate Ford India Pvt Ltd.

2003: Ford launched its first SUV in India, the Ford Endeavour, based mostly on the Ford Ranger pickup truck.

2010: The launch of the Ford Figo marked the corporate’s important foray into the compact automotive phase, which was well-received within the Indian market.

2013: The Ford EcoSport, a compact SUV, was launched, turning into a game-changer for the corporate in India, particularly with its success in each home and export markets.

2019: Ford entered right into a three way partnership with Mahindra & Mahindra to share expertise and sources, aiming for value effectivity in India’s aggressive market.

2020: The Ford-Mahindra three way partnership was dissolved, and Ford introduced its determination to go solo in India, however gross sales continued to wrestle.

September 2021: Ford introduced its exit from the Indian home automotive market, ending manufacturing for native gross sales as a result of sustained monetary losses.

February 2022: Ford briefly re-entered India by bagging incentives below the production-linked incentive (PLI) scheme for electrical autos however quickly reversed its determination in Might 2022.

August 2022: Ford bought its Sanand manufacturing plant in Gujarat to Tata Motors for Rs 7.26 billion (roughly US$91.5 million).

September 2022: Ford closed its remaining operations in India, together with the Maraimalai Nagar plant close to Chennai.

September 2023: Ford signed a letter of intent with the Tamil Nadu authorities to discover restarting manufacturing at its Chennai plant, primarily for exports to international markets, marking a possible re-entry into the Indian market centered on exports.

September 13, 2024:  Ford proclaims re-entry into India with plans to restart work on the Chennai plant to fabricate automobiles, initially for exports.

Ford’s success and challenges in India

Though Ford’s early fashions just like the Ikon and Fiesta had been well-received, it was the EcoSport that actually put Ford on the map in India. The compact SUV grew to become a favorite within the nation, and its sub-4-metre dimension allowed Ford to learn from tax breaks for smaller automobiles. Ford exported this mannequin to a number of international markets, additional cementing the significance of its Indian operations.

Ford’s renewed curiosity within the Indian automotive scene could also be pushed by its broader international technique. Media stories point out that its presence in China is shrinking as a result of intense competitors from native producers, Ford is trying to strengthen its place in different areas, corresponding to Australia, New Zealand, and West Asia. By changing the Chennai facility into an export hub, Ford goals to leverage India’s comparatively low manufacturing prices and strategic location for exports.

Benefits of Chennai mfg plant for Ford

Maraimalai Nagar affords important logistical benefits for Ford. It’s well-connected to main ports, with Chennai port simply 50 kilometres away and Ennore port 74 kilometres distant. This makes it simpler for Ford to ship its autos to worldwide markets, significantly as the corporate plans to double down on exports in areas like Saudi Arabia, the UAE, and Australia.

The plant itself, which noticed an funding of roughly $1 billion, was as soon as a key participant in Ford’s international export operations. Its proximity to very important transportation routes and its capability for large-scale manufacturing make it a really perfect location for the automaker’s future endeavours.
 

First Revealed: Sep 16 2024 | 11:06 AM IST